FRANKFURT, July 24, 2026, 12:07 CEST
- SAP shares rose 6.2% to €136.28 at 11:41 CEST, while Xetra’s main session remained open.
- Cloud backlog rose 26% at constant currencies, surpassing the expected increase of about 24%.
- According to initial intraday estimates, Friday’s activity increased market value by about €9.8 billion.
SAP stock rose as cloud backlog growth surpassed cloud revenue growth, marking a four percentage point swing from the previous quarter. This improvement in forward demand outweighed a €100 million reduction to its annual profit outlook.
The quarter did not deliver an across-the-board beat. Cloud revenue was 0.4% ahead of consensus. Non-IFRS operating profit came in 4.8% below estimates. Investors concentrated on contract performance.
In the second quarter, cloud backlog increased by 26% at constant currencies, while cloud revenue gained 24% on the same basis. These figures compare with 25% and 27% growth rates, respectively, in the first quarter.
According to SAP’s preliminary and unaudited data, the crossover has occurred.
| Measure | Q1 2026 | Q2 2026 | Change |
|---|---|---|---|
| Growth in current cloud backlog, at constant currencies | 25% | 26% | +1 point |
| Cloud revenue increase, at constant currencies | 27% | 24% | -3 points |
| Difference between backlog growth and cloud revenue growth | -2 points | +2 points | +4 points |
| Non-IFRS operating profit increase, at constant currencies | 24% | 9% | -15 points |
The cloud backlog now stands at €22.93 billion, representing contracted cloud revenue anticipated over the next 12 months. Reltio’s impact on constant-currency growth was under one percentage point.
An early intraday estimate shows equity value rising by about €9.8 billion. The midpoint of the guidance decreased by €100 million. The math aligns with Friday’s emphasis on bookings.
Cloud ERP Suite revenue increased by 27% to €5.53 billion, accounting for around 88% of SAP’s overall cloud revenue. Software support declined 7%, and licence revenue was down 32%.
Costs were higher. Non-IFRS cloud gross margin declined by 0.7 percentage points to 74.6%. IFRS research expenditure increased 14%.
SAP cut its non-IFRS operating profit outlook to a range of €11.8 billion to €12.2 billion, attributing the change to dilution exceeding €100 million from Dremio and Prior Labs. CFO Dominik Asam stated, “The only change is the operating profit adjustment … driven solely by mergers and acquisitions.” Reuters
Guidance for cloud revenue was unchanged at €25.8 billion–€26.2 billion. Forecast for free cash flow also remained around €10 billion.
Asam presented enterprise AI primarily as a challenge of data governance. “The idea that AI will solve all these problems if they are messy, legacy data silos is not true,” he said. Reuters
Friday’s rebound has not reversed the overall decline. SAP is still 35% lower so far this year. In comparison, the STOXX 600 technology index has climbed 16%. The difference stands at 51 points.
Risks persist. Cloud margins declined, support revenue decreased, and SAP anticipates its backlog to grow at a marginally slower pace. The forecast is based on expectations of short-term de-escalation in the Middle East. Current June exchange rates would reduce full-year cloud revenue growth by 1.5 percentage points and full-year profit growth by two percentage points.
The favorable backlog gap now needs to translate into revenue. Executives continue to anticipate that overall revenue growth will pick up speed in 2027. Friday’s market action valued that trajectory more highly than short-term margins.
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